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REAL ESTATE
AND
NEW YORK, NOVEMBER 7, 1914
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UPSTATE COUNTIES THRIVING OFF THE CITY
Unjust Taxes Imposed Upon the City of New York by the
Assessors of the Taxing Districts in the Catskill Watershed
By IRA J. ETTINGER
Executive Secretary, United Real Estate Owners' Associations
fiiiilliiMii^^
ONE of the most important subjects
which is now engaging the attention
of the Taxation Committee of the United
Real Estate Owners' Associations is the
grave and serious injustice done to the
City of New York by the local assessors
in about twenty towns in which the
aqueduct property recently acquired by
the City of New York is situate, in plac¬
ing assessments against the City of New
York in utter disregard of the value of
the property and including in such valua¬
tions dams and aqueducts above or be¬
low the ground including in many cases
tunnels far beneath the surface and tak¬
ing the cost of the construction as the
basis for the assessment.
This unjust imposition affects every
taxpayer in the city. For the year 1913
increases in assessed valuation amounted
to twenty-two and a half millions of dol¬
lars upon the holdings which the city
acquired for the Catskill water supply
purposes alone; and this increase repre¬
sents solely the value of construction
work and reflects no increased worth in
the land.
In the whole United States there are
only two commonwealths, namely, Mas¬
sachusetts and New York, wdiere such a
species of taxation exists. In the State
of New Jersey it has always been the
law, as it has been in all of the other
commonwealths, that a water supply is
a public necessity and must be provided
by the State for the people of its sepa¬
rate municipalities, in order to enable
them to exist. Under the old common
law no property used for water supply in
the State of New York was taxed, no
matter where it was located in the State,
but this was changed by Chapter 502 of
the Laws of 1866, which was incorporat¬
ed in the Consolidated Laws of 1882, and
was subsequently re-enacted in the
Greater New York Charter as Section
480.
Where the Trouble Began.
The protecting clause in Section 480
of the Greater New York Charter was
stricken out in the year 1901, and this
has been the origin of all our present dif¬
ficulties. When the General Tax Law
of 1909 was passed it was claimed that it
repealed all previous laws including the
Charter provision with the result that
each of these separate towns has im¬
posed upon the City of New York a dif¬
ferent rule of assessment. And as was
stated in the brief of the Corporation
Counsel of the City of New York in con¬
nection with the amendment proposed in
the Legislature in the year 1913: "We
have the unusual spectacle of municipal
corporations, creatures of the State, gov¬
erned and controlled by the Legislature,
engaged in bitter and costly litigation
at the expense of the taxpayers of each
community, all of whom are citizens and
residents of this State, and each of whom
are entitled to exact and equal justice at
the hands of the Lesfislature."
In the. State of Massachusetts it was
not until 1903 that a law was passed
which made the land, but exclusive of
constructions, assessable for purposes of
5uch taxation; and this law was adopts
IRA J. ETTINGER.
ed because the City of Boston extended
its municipal water supply system and
reached out to bring in streams and im¬
pound them for the purpose of supplying
its population; and land taken for the
water system was placed upon the tax
list.
Failure of Relief Measures.
During the session of the New York
Legislature in the year 1913 a bill was
introduced amending the Tax Law pro¬
viding that all lands heretofore or here¬
after acquired for the purpose of a water
supply by any municipal corporation
within the limits of another municipal
corporation shall hereafter be assessed
and taxed at the value of said lands ex¬
clusive of all dams, aqueducts and other
structures necessary for the purpose of a
water supply and it was therein provided
that in the valuation of said lands the
assessors shall treat all lands flooded by
the construction of dams, or used for
the purpose of storing or impounding
waters thereon, as land not under water,
but despite all of the efforts put forth by
the City of New York and its represen¬
tatives and notw^ithstanding the argu¬
ment presented by President Charles
Strauss, of the Board of Water Supply,
before the joint Committee on Taxation
and Retrenchment, the bill failed of pas¬
sage and the old confused and unjust
system has continued to this very day.
The brief of the Corporation Counsel
recites that there are pending in the
courts in the counties of Westchester
and Putnam one hundred and twenty
certiorari proceedings to review the in¬
equalities and over-valuations of the as¬
sessment of the lands of the City of
New York in fifteen different tax dis¬
tricts. These over-valuations occur on
property of the City of New York that
contains no structures because of the
idea in the minds of the various assess¬
ors that the City of New York is a rich
municipality because it is deenied just
and proper to extract as much money
from the City of New York as a tax¬
payer as is possible and to make the tax
burden upon the City of New York as
heavy- as the ingenuity of the local as¬
sessor might devise.
Because of the uncertainty of the law
and the decisions of the courts upon the
subject the assessors also claim the right
to assess the aqueduct structures, al¬
though Supreme Court Justice Mor-
schauser, sitting in Orange County, de¬
cided that the aqueduct structures were
not assessable, which decision has since
been affirmed by the Appellate Division,
an appeal having been taken to the
Court of Appeals which has not yet ren¬
dered its opinion in the matter.
Specific Cases of Injustice,
To show the real injustice that has
been practiced upon the City of New
York by the different communities a few
glaring instances, taken from the memo¬
randum of the Board of Water Supply
will now be cited:
In the Town of Mt. Pleasant, West¬
chester County, parcel 803, consisting of
43 acres, was assessed in 1910 at $21,945,
an average of $500 an acre. The assess¬
ment against the former owner who
parted with the property the year-be¬
fore the city acquired it, was at the rate
of $100 an acre.
Parcel 805 was assessed in 1905 at $50O
an acre. The former owner, the year
before, was assessed at only $92 an acre.
In the Town of Cortlandt. Westches¬
ter County, the average assessment per
acre against the citizens is $716, while
the assessment as:ainst the City of Nevv
York is $4,348. the City of New York
owns 5 per cent, of the area and pays 23
per cent, of the taxes.
In the Town of Gardiner, Ulster
County, parcel 221 is known as the
Deyo Farm. It consists of 160 acres;
the city took 8J/2 acres, and while the
assessment of $4,300 was placed against
the former owner upon the entire 160
acres in 1907, the city, on taking title,
was assessed $3,225. In this town in
1908 the assessment was $18.74 per acre;
when the City of New York came in
there the assessment was increased to
$375 per acre upon all the land to which
the City of New York took title.
In the Town of Philipstown, Putnam
County, the assessment on the identical
lands was increased from $68,803 in 1912
to $3,030,203 in 1913. This assessment
was protested by the city on Grievance
Day, and a bill was later rendered to the
Board of Water Supply for 'the 1913
taxes for $490,321; the payment of these
taxes has been withheld by the city
pending the result of certiorari proceed- -
ings.
What Yonkers Has Done.
In the City of Yonkers the assessment
was increased from $750,550 in 1913 to
$19,280,150 for 1914; and payment^ of
these taxes is now the subject of litiga¬
tion.
These are not exceptional instances;
they simply indicate the general spirit
of the assessors throughout these .coun¬
ties, resulting in gross injustice to the